Hearing from renters in the Multifamily Property Tax Exemption (MFTE) Program

The City of Seattle's Multifamily Property Tax Exemption (MFTE) program provides a property tax exemption to owners of multifamily rental properties where rent and utilities for a share (20% or 25%) of the apartments are limited for income-qualified renters. Since the program began in 1998, it has produced over 7,000 income and rent-restricted apartments in 300 buildings.

Evaluating the MFTE program

For the first time, The Seattle Office of Housing (OH) surveyed renters who live in MFTE apartments to learn about their experiences. Over 600 renters responded to the survey, sharing valuable insights into the program.

What renters said benefits them from MFTE

Most survey respondents (85%) report that they enjoy living in their neighborhood and apartment buildings. Many shared personal stories about how the program has impacted them. One renter wrote "I just want to say I'm so glad this program exists (…) There is no way I could afford my apartment otherwise. I would have to live an hour and a half away from work and battle traffic (…) to live somewhere I could afford. I'm very grateful for this program."

Others reported that MFTE allows them to live in Seattle on a fixed income: "With MFTE we are able to put down roots knowing our [rent] increase will be minimal. This is especially important to us as my partner is on SSI and the low rent allows him to have [money] left over after he pays his half of the rent. MFTE also allows us to live in a safe place that makes his life not only easier but better." These personal experiences make clear that the MFTE program is having a profound impact on people.

The affordability of MFTE apartments

A key finding from the survey is that MFTE renters still face housing affordability challenges. Over 80 people out of the nearly 600 surveyed shared concerns about affording rent, reported spending a large portion of their income on rent and utilities, worried about yearly rent increases, or noticed that MFTE apartments are sometimes not more affordable than market-rate apartments.

One renter noted that "The rent is not much lower than regular rent. It cost more than half of my Social Security but is the least expensive unit I can find." This renter is describing severe housing cost burden, which is defined as spending more than half of one's income on rent.

Others shared their anxieties about increasing housing costs: "I'm grateful to have the apartment that I have, but (…) I stress to come up with [rent] every month, plus the yearly increases, utilities, and parking spot I need in this neighborhood."

Some expressed frustration that the rents for MFTE homes were not lower than market rents in their neighborhood and questioned why they participate in MFTE: "The cost of this apartment is so close to market rate it is almost not worth it to be in this program. I have not moved out because I don't want the bother of moving, but the cost of the apartment should be lower, given the market rate of similar units in the surrounding neighborhood."

Some numbers

The average household income for an MFTE renter is 49% of Area Median Income (AMI). For an individual, this is about $52,000 a year in 2024. For a family of four, this is around $75,000 per year. Housing is considered affordable when households spend less than 30% of their income on housing costs. The average MFTE apartment rent is set for 72% AMI, which means that MFTE rents are set about 23% higher than the average incomes of households living in these apartments. In 2023, over 85% of MFTE renters were cost burdened, meaning they spend more than 30% of their household income on housing costs, with 25% of MFTE renters experiencing severe cost burden (spending more than half of their income on housing). Being housing cost burdened can make it difficult to afford necessities like groceries and other expenses.

Searching and applying for MFTE apartments can be tricky

Dozens of renters shared that it could be difficult to find information on property websites and the City website about the MFTE program, pointing to a need for better messaging and marketing of the program.

One renter summed up the need for more transparency around the program: "It was a really difficult process to find these units. I found a couple by calling through the list of complexes on the City of Seattle site. It is very scary because affordable housing is so difficult to find, and when you do find it, it feels like scrambling." Another renter shared that "Information is hard to find unless you know exactly what you're looking for."

The application process can also be a challenge. Forty two percent (42%) of renters found the MFTE application process difficult to complete. Many are frustrated with the amount of paperwork and the time it takes to get approved for an MFTE home.

Looking ahead to reauthorization of the MFTE Program

Feedback from the MFTE Renter Survey helps us understand the impact of the program and areas that need improvement. The survey results will also help shape the next iteration of MFTE (Program P7) policies and procedures. In early 2025, City Council will decide on legislation to reauthorize the program with new rules. The reauthorization process is an opportunity to make improvements to the MFTE program so that it can better meet Seattle's housing needs. The Seattle Office of Housing appreciates all who took the time to share feedback through the survey.

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